EPIBuilding a Sustainable Future
Lester R. Brown

Chapter 4. Rising Temperatures and Rising Seas: More Destructive Storms

Rising seas are not the only threat. Higher temperatures in the surface water in the tropical oceans mean more energy radiating into the atmosphere to drive storm systems, leading to more frequent, more destructive storms. The combination of rising seas, more powerful storms, and stronger storm surges can be devastating. Such a combination would wreck havoc with low-lying coastal cities, such as Shanghai and New Orleans.

In the fall of 1998, Hurricane Mitch—one of the most powerful storms ever to come out of the Atlantic, with winds approaching 200 miles per hour—hit the east coast of Central America. As atmospheric conditions stalled the normal progression of the storm to the north, some 2 meters of rain were dumped on parts of Honduras and Nicaragua within a few days. The deluge collapsed homes, factories, and schools, leaving them in ruins. It destroyed roads and bridges. Seventy percent of the crops and much of the topsoil in Honduras were washed away—topsoil that had accumulated over long stretches of geological time. Huge mudslides destroyed villages, sometimes burying the entire population.44

The storm left 11,000 dead and thousands more missing. The basic infrastructure—the roads and bridges in Honduras and Nicaragua—was largely destroyed. President Flores of Honduras summed it up this way: "Overall, what was destroyed over several days took us 50 years to build." The damage from this storm, exceeding the annual gross domestic product of the two countries, set their economic development back by 20 years.45

Munich Re, the world's largest reinsurer, a company that spreads risks among the insurance companies, is worried about the effects of climate change on the financial viability of the industry. It has published a list of storms with insured losses of $1 billion or more. The first such natural disaster came in 1983, when Hurricane Alicia struck the United States, racking up $1.3 billion in insured losses. Of the 34 natural catastrophes with $1 billion or more of insured losses recorded through the end of 2001, two were earthquakes; the other 32 were atmosphere-related-storms, floods, or hurricanes. During the 1980s, there were three such events. But during the 1990s, there were 25.46

The two largest events in terms of total damage were Hurricane Andrew in 1992, which took down 60,000 homes and racked up $30 billion worth of damage, and the flooding of China's Yangtze river basin in 1998, which also cost an estimated $30 billion. This sum is equal to the value of the harvest of China's two food staples, wheat and rice, combined. Part of this growth in damage is due to greater development in coastal areas and river floodplains. But part is due to more frequent, more destructive storms.47

The regions most vulnerable to more powerful storms are the Atlantic and Gulf coasts of the United States and the Caribbean and Central American countries. In Asia, it is East and Southeast Asia, including countries like the Philippines, Taiwan, Japan, China, and Viet Nam, that are likely to bear the brunt of the powerful storms crossing the Pacific. Further west in the Bay of Bengal, Bangladesh and the east coast of India are particularly vulnerable.

Western Europe, traditionally experiencing a heavily damaging winter storm perhaps once in a century, had its first winter storm to exceed a billion dollars in 1987—one that wreaked $3.7 billion in destruction, $3.1 billion of which was covered by insurance. Since then, it has had seven winter storms with insured losses ranging from $1.3 billion to $5.9 billion.48

Andrew Dlugolecki, a senior officer at the CGNU Insurance Group, the largest insurance company in the United Kingdom, notes that damage from atmospherically related events has increased by roughly 10 percent a year. "If such an increase were to continue indefinitely," he notes, "by 2065 storm damage would exceed the gross world product. The world obviously would face bankruptcy long before then." In the real world, few trends continue at a fixed rate over a period of several decades, but Dlugolecki's basic point is that climate change can be destructive, disruptive, and enormously costly.49

Insurance companies are convinced that with higher temperatures and more energy driving storm systems, future losses will be even greater. They are concerned about whether the industry can remain solvent under this onslaught of growing damages. So, too, is Moody's Investors Services, which in early 2002 downgraded the credit-worthiness of four of the world's leading reinsurance companies.50

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44. Janet N. Abramovitz, "Averting Unnatural Disasters," in Lester R. Brown et al., State of the World 2001 (New York: W.W. Norton & Company, 2001), pp. 123-42.

45. Storm death toll from National Climatic Data Center, National Oceanic & Atmospheric Administration, U.S. Department of Commerce, "Mitch: The Deadliest Atlantic Hurricane Since 1780," www.ncdc.noaa.gov/oa/ reports/mitch/mitch.html, updated 25 January 1999; Flores quoted in Arturo Chavez et al., "After the Hurricane: Forest Sector Reconstruction in Honduras," Forest Products Journal, November/December 2001, pp. 18-24; gross domestic product from International Monetary Fund (IMF), World Economic Outlook Database, at www.imf.org/external/pubs/ft/weo, updated April 2003.

46. Munich Re, Topics Annual Review: Natural Catastrophes 2001 (Munich, Germany: 2002), pp. 16-17.

47. Ibid.; value of China's wheat and rice harvests from USDA, op. cit. note 8, using prices from IMF, International Financial Statistics (Washington, DC: various years).

48. Munich Re, op. cit. note 46.

49. Andrew Dlugolecki, "Climate Change and the Financial Services Industry," speech delivered at the opening of the UNEP Financial Services Roundtable, Frankfurt, Germany, 16 November 2000; "Climate Change Could Bankrupt Us by 2065," Environment News Service, 24 November 2000.

50. "Disaster and Its Shadow," The Economist, 14 September 2002, p. 71.


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